What is a Partnership?
A partnership is an arrangement where parties known as business partners agree to cooperate to advance their mutual interests. In this process anyone can be partners, whether you are individuals, businesses, interest-based organizations, school, governments or combinations. It is a formal arrangement that is manage by two or more parties to operate a business and share its profit. Among other things, it also states the (1) nature of the business, (2) capital contributed by each partner, and (3) their rights and responsibilities.
Characteristics of Partnership Firm
1: Sharing of Profits
2: Agency Relationship
3: Nature of Liability
4: Fusion of Ownership and Control
5: Existence of Business
6: Existence of an agreement and more
Moreover, there are 4 types of partnerships that one can enrol in suchlike general partnership, limited, limited obligation and public private and so on. Therefore, one of the main advantages of Partnership it holds are: greater managements skills, higher chance and opportunity of keeping competent employee, greater sources of financing, ease of formation and freedom to manage.
Thus, these are the companies that provide services such as accounting, marketing, product development, maintenance or training that are essential growth or efficiency of a small business. The service partners offer you the opportunity to supplement your resources by providing skills or services that your business does not have. This type of strategic partnership agreement is most beneficial to small businesses with a limited selection of products and services to offer.
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